Your executive summary is the first part of your business plan, but you usually write it last because it is a summary of all the important parts.
The point of your Executive Summary is to get the reader’s attention quickly. Tell them what kind of subscription box business you have and how it’s going. For instance, are you a new business or do you have a business that you want to grow?
Next, give an overview of each part of your plan that follows. For example, you could give a brief overview of the industry of subscription boxes. Talk about what kind of subscription box business you run. Detail your direct competitors. Describe the people you want to reach. Give a brief overview of your marketing plan. Find the important people on your team. And explain what your financial plan is.
In your business analysis, you will explain what kind of subscription box business you run.
For example, you might have one of the following types of subscription box businesses:
- Personal Care Subscription Box: This type of subscription box business includes boxes with items for personal care, such as makeup, skin care products, shaving supplies, etc.
- Food/Beverage Subscription Box: This type of subscription box is used to send groceries, snacks, coffee, wine, etc.
- Clothing Subscription Box: This type of subscription box can have hand-picked clothes, underwear, and other items.
- Pet Subscription Box: This type of subscription can be for things like food and medicine for your pet, or it can be for things like toys and treats.
In the Company Analysis section of your business plan, you need to explain what kind of subscription box business you will run and give background information about the business.
Answers should be given to questions like:
- When did you start your business, and why?
- What is your way of doing business?
- What important steps have you taken so far? Milestones could be things like the number of active subscriptions, the number of positive reviews, reaching X in sales, etc.
- Your legal structure. Are you set up as an S-Corporation? An LLC? A single-person business? Tell us about the legal structure of your business.
In your industry analysis, you need to give an overview of the subscription box business.
Even though this may seem pointless, it has more than one use.
First, learning about the subscription box business gives you knowledge. It gives you a better idea of the market you are in.
Second, market research can help you make your strategy better, especially if it shows you market trends.
The third reason to do market research is to show your readers that you know a lot about your field. You do just that by doing the research and putting it in your plan.
In the industry analysis section, you should answer the following questions:
- How many dollars is the subscription box business worth?
- Is the market going down or up?
- Who are your main rivals in the market?
- Who are the main market suppliers?
- What changes are happening in the field?
- How fast is the industry expected to grow in the next 5–10 years?
- How big is the market that matters? That is, how big is your business’s possible market for subscription boxes? You can figure out such a number by figuring out how big the market is in the whole country and then applying that number to the population in your area.
In the customer analysis section, you need to explain who you serve and/or who you hope to serve.
The Millennials, Gen X, and Baby Boomers are all examples of customer segments.
As you might guess, the type of subscription box business you run will depend a lot on the customer segment(s) you choose. Obviously, Gen X would respond to different marketing campaigns than, say, Millennials.
Try to figure out who your target market is by looking at their demographics and how they think and feel. In terms of demographics, talk about the ages, genders, locations, and income levels of the people you want to serve.
Psychographic profiles explain what your target market wants and needs. The better you can understand and define these needs, the easier it will be to get customers and keep them coming back.
In your competitive analysis, you should list your business’s direct and indirect competitors and then focus on the direct ones.
Subscription box businesses are their main rivals.
Indirect competitors are other places where customers can buy things that aren’t direct competitors. This includes people who buy the things they want in physical stores or on other ecommerce websites. You should also talk about this competition.
In terms of direct competition, you should list the other subscription box businesses that you are in direct competition with. Most likely, your main rivals will be subscription box businesses that sell the same kinds of goods as you do.
Give an overview of each of these competitors’ businesses and list their strengths and weaknesses. Unless you’ve worked at one of your competitors’ companies, you won’t know everything about them. But you should be able to find out key facts about them, such as:
- What kind of clients do they work with?
- What kind of monthly boxes are they?
- How much do they charge (high, low, etc.)?
- What can they do well?
- What do they do wrong?
For the last two questions, try to answer them from the customers’ point of view. And don’t be afraid to ask the customers of your competitors what they like and dislike about them.
The last part of your competitive analysis section is to list the ways you are better than your competitors. As an example:
- Will you send curated packages?
- Will you have products that your competitors don’t have?
- Will you treat your customers better?
- Will you price things better?
Think about how you will do better than your competitors and write them down in this part of your plan.
Usually, a marketing plan has four parts: the product, the price, the place, and the promotion. Your marketing plan for a subscription box business should include the following:
Product: In the product section, you should repeat the type of subscription box business you wrote about in your Company Analysis. Then, give specifics about the products you’ll be selling. For example, will you offer wine add-ons or any other services in addition to a meal subscription box?
Price: Write down the prices you’ll be charging and how they compare to those of your competitors. In your marketing plan, the product and price sections are basically where you list the services you offer and how much they cost.
Place: This is where your subscription box company is located. Write down where you are and how that will affect your success. For example, can customers get your subscription box just from your website, or do you also have affiliates who sign up customers for you, etc.? Talk about why your location could be the best for your customers.
Promotions: The last part of your marketing plan for your subscription box is the section on promotions. Here, you’ll write down how you’ll get people to your location (s). Here are some ways you could promote your business:
- Bloggers and other websites are contacted.
- Social media marketing
- Radio advertising TV advertising
In the other parts of your business plan, you talked about your goals. In your operations plan, you talk about how you will reach those goals. Your plan for operations should have two separate parts.
Everyday short-term processes include all the tasks you need to do to run your subscription box business, such as finding and putting together products, managing subscriptions, packaging and shipping products, helping customers, etc.
Long-term goals are the goals you want to reach in the future. These could be dates like when you think you’ll get your Xth subscription or when you hope to make $X. It could also be when you plan to add a new type of product to your subscription box business.
For your subscription box business to show that it can be successful, you need a strong management team. Showcase the backgrounds of your key players, focusing on the skills and experiences that prove they can help a company grow.
You and/or other members of your team should have direct experience running subscription box businesses. If so, talk about your experience and skills. But also highlight any experience you think will help your business succeed.
If your team is missing something, you might want to put together an advisory board. A two-to-eight-person advisory board would help your business in the same way that a mentor would. They would help answer questions and give advice on how to plan. If you need to, look for advisory board members who have managed an e-commerce business or a customer service team well.
Your 5-year financial plan should include a monthly or quarterly breakdown for the first year, then an annual breakdown after that. Your income statement, balance sheet, and cash flow statement are all part of your financial statements.
A more common name for an income statement is a Profit and Loss statement, or P&L. It shows your income and then takes away your expenses to show if you made a profit.
You need to make assumptions in order to make your income statement. For example, will you offer different kinds of boxes, and do you plan to have 250 or 1,000 monthly subscribers? And will sales grow by 2% or 10% every year? As you might expect, the financial forecasts for your business will be greatly affected by the assumptions you choose. Do as much research as you can to try to make sure your assumptions are true.
The Balance Sheets
Balance sheets list what you own and what you owe. Balance sheets can have a lot of information, but try to boil them down to the most important parts. For example, if you spend $50,000 building up your subscription box business, you won’t make money right away. Instead, it is an asset that you can use to make money for years to come. Likewise, if a bank gives you a check for $50,000, you don’t have to pay it back right away. Instead, you will have to pay that back over time.
Statement of Cash Flow
Your cash flow statement will help you figure out how much money you need to start or grow your business and make sure you never run out of cash. Most business owners and entrepreneurs don’t realize that you can make money but still go bankrupt if you run out of money.
When making your Income Statement and Balance Sheet, make sure to include some of the most important costs of starting or growing a subscription box business:
- Cost of software for computers.
- Cost of supplies and equipment
- Price of things
- Payroll or wages given to employees Business insurance
- Taxes and licenses:
- Legal expenses